India Inflation March 2016

India

India: Inflation falls to six-month low in March and decrease in wholesale prices stabilizes

April 14, 2016

Consumer prices recorded flat growth in March over the previous month, which contrasted February’s 0.24% drop. The result was largely driven by a slight rise in prices for tobacco and intoxicants, which was offset by lower prices for fuel and light. Inflation eased in March, coming in at 4.8%, which represented a six-month low (February: 5.3%). March’s result came in below market analysts’ expectations of 5.0% inflation.

The wholesale price index (WPI) in March rose 0.34% over the previous month, which contrasted February’s 0.97% fall. March’s reading reflected rising prices for manufactured goods as well as for fuel and power products. On an annual basis, wholesale prices fell 0.9% in March, which mirrored February’s result. However, the trend pointed up and annual average WPI inflation rose from minus 2.6% to minus 2.5%.

FocusEconomics Consensus Forecast panelists expect consumer price inflation to average 5.1% in FY 2016, which is down 0.1 percentage points from last month’s forecast. In FY 2017, the panel expects consumer price inflation to average 5.2%. Panelists expect wholesale price inflation of 1.2% in FY 2016, which is down 0.5 percentage points from last month’s forecast. In FY 2017, the panel expects wholesale price inflation to average 3.3%.


Author: Angela Bouzanis, Senior Economist

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India Inflation Chart


India Inflation March 2016

Note: Annual and monthly variation of wholesale price index (WPI) and annual variation of consumer price index (CPI) in %.
Source: Ministry of Commerce and Industry and FocusEconomics calculations.


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